Occasional Allies, Enduring Rivals: Turkey’s Relations with Iran Gareth H. Jenkins SILK ROAD PAPER May 2012 Occasional Allies, Enduring Rivals: Turkey’s Relations With Iran Gareth H. Jenkins © Central Asia-Caucasus Institute & Silk Road Studies Program – A Joint Transatlantic Research and Policy Center Johns Hopkins University-SAIS, 1619 Massachusetts Ave. NW, Washington, D.C. 20036 Institute for Security and Development Policy, V. Finnbodav. 2, Stockholm-Nacka 13130, Sweden www.silkroadstudies.org “Occasional Allies, Enduring Rivals: Turkey’s Relations With Iran” is a Silk Road Paper published by the Central Asia-Caucasus Institute and the Silk Road Studies Program. The Silk Road Papers Series is the Occasional Paper series of the Joint Center, and addresses topical and timely subjects. The Joint Center is a transatlantic independent and non-profit research and policy center. It has offices in Washington and Stockholm and is affiliated with the Paul H. Nitze School of Advanced International Studies of Johns Hopkins University and the Stockholm-based Institute for Security and Development Policy. It is the first institution of its kind in Europe and North America, and is firmly established as a leading research and policy center, serving a large and diverse community of analysts, scholars, policy-watchers, business leaders, and journalists. The Joint Center is at the forefront of research on issues of conflict, security, and development in the region. Through its applied research, publications, research cooperation, public lectures, and seminars, it functions as a focal point for academic, policy, and public discussion regarding the region. The opinions and conclusions expressed in this study are those of the author only, and do not necessarily reflect those of the Joint Center or its sponsors. © Central Asia-Caucasus Institute & Silk Road Studies Program, 2012 ISBN: 978-91-86635-30-5 Printed in Singapore Distributed in North America by: The Central Asia-Caucasus Institute Paul H. Nitze School of Advanced International Studies 1619 Massachusetts Ave. NW, Washington, D.C. 20036 Tel. +1-202-663-7723; Fax. +1-202-663-7785 E-mail: [email protected] Distributed in Europe by: The Silk Road Studies Program Institute for Security and Development Policy V. Finnbodavägen 2, SE-13130 Stockholm-Nacka E-mail: [email protected] Editorial correspondence should be addressed to Svante E. Cornell, Research and Publications Director, at either of the addresses above (preferably by e-mail). Table of Contents Executive Summary ...................................................................................................... 5 The Historical Context: Turkish-Iranian Relations To 2002 ................................. 10 Reform and Rapprochement ........................................................................... 12 Revolution and War ........................................................................................ 16 Regional Rivalry .............................................................................................. 17 Stirring the Pot? ............................................................................................... 19 Economic Reliance, Political Estrangement .................................................. 21 Turkish-Iranian Political Relations Under The AKP ............................................ 26 From Confrontation to Convergence: Cooperation Against the PKK and PJAK ................................................................................................................. 32 Bilateral Engagement, Regional Ambitions .................................................. 34 A Reemerging Rivalry: Turkey, Iran and the “Arab Spring” .................... 40 The Deepening Sectarian Divide: New Tensions in Iraq ........................... 43 Competition and Conflict by Proxy: Central Asia and the Caucasus ....... 45 Turkish-Iranian Economic Relations Under The AKP ......................................... 50 Bilateral And Multilateral Agreements And Mechanisms ......................... 51 Energy and Bilateral Trade ............................................................................. 53 Turkish Investment In Iran ........................................................................... 61 Iranian Investment In Turkey ....................................................................... 63 The Impact of Economic Sanctions against Iran ........................................ 67 Conclusion: Implications and Prospects ................................................................... 70 Author Bio .................................................................................................................... 76 Executive Summary In early 2010, Turkey’s vigorous attempts to forestall additional international sanctions against Iran over its nuclear program led to speculation in the Western media of an “axis shift” in Ankara’s foreign policy. There were claims that the ruling Justice and Development Party (AKP), which has its roots in Turkey’s Islamist movement, was turning its back on the country’s traditional Western allies in favor of a strategic alliance with one of the West’s most obdurate adversaries. The concerns intensified when, after its efforts to broker a deal between Teheran and the international community ended in failure, Turkey sought to block additional sanctions against Iran at the UN Security Council. Although this attempt was also unsuccessful, the fact that it was made at all – and in open defiance of repeated requests from the U.S. – was immediately cited as further proof of a shift in Turkey’s strategic orientation; a confirmation that a once pro-Western Muslim country had become an anti-Western one. In reality, the motivation behind Turkey’s willingness to confront its Western allies over Iran’s nuclear program was never as simple as a desire to exchange membership of one alliance with membership of another. It was rather the product of a number of different factors, the most important of which was the desire to establish Turkey as the preeminent arbiter of power in its region: not a country which attached itself to others but a center to which others would gravitate. Consequently, the collapse in October 2009 of a complex swap deal – in which the international community would attempt to ensure that Teheran did not enrich uranium to weapons grade by exchanging nuclear fuel for uranium enriched to a low level inside Iran – was regarded in Ankara as an opportunity. The AKP genuinely resented what it regarded as the West’s hypocrisy towards Iran over its nuclear program, particularly its eagerness to impose sanctions on suspicion that Teheran was secretly planning to develop nuclear weapons while declining even to criticize the one country in the 6 Gareth H. Jenkins Middle East which was known to have already developed a stockpile of nuclear warheads, namely Israel. But the AKP’s primary motivation was self-aggrandizement, a desire to demonstrate not only that it could succeed in brokering an agreement where others had failed but that, when it came to the Middle East, it was Turkey, not the West, that possessed the necessary contacts, expertise and credibility to secure results. What eventually became a defense of Iran’s policies and motives against a doubting West undoubtedly strengthened Teheran, which was quick to seize the opportunity to try to exploit the division between Turkey and its fellow members of NATO. Yet the AKP’s overriding goal was not to benefit Iran but to boost Turkey’s own claims to regional preeminence. But it would be a mistake to regard Turkey’s relationship with Iran under the AKP as purely opportunistic or one dimensional. On the contrary, rather than marking a fundamental shift in relations, the coming to power of the AKP appears merely to have further complicated an already complex and multilayered relationship; adding or amending some elements, while leaving others essentially unchanged. Nor did all of the different elements in the relationship necessarily move together in the same direction. Indeed, one of the most striking characteristics of relations between Turkey and Iran since November 2002 has been the contrast between the enthusiasm of the repeated public declarations of friendship and commitments to future cooperation and the paucity of attempts to translate rhetoric into action. This disparity has been particularly noticeable in economic relations. The increase in trade with Iran under the AKP is often cited to support claims of a strategic relationship. It is true that, since the AKP first came to power, bilateral trade between Turkey and Iran has grown more than tenfold from $1.25 billion in 2002 to $16.05 billion in 2011. Yet the balance of trade has been heavily in Iran’s favor. In 2011 the margin was nearly four to one. The main reason has been Turkish imports of Iranian hydrocarbons; particularly natural gas from the Tabriz-Erzurum pipeline – which came on stream in 2001, the year before the AKP came to power1 – and, particularly in 2011, 1 The natural gas agreement was signed in 1997 when the Turkish government was led by the Islamist Welfare Party (RP), one of the AKP’s predecessors. But the Occasional Allies, Enduring Rivals: Turkey’s Relations with Iran 7 Turkish purchases of Iranian oil. Yet the reasons are practical not ideological: an attractive price for the oil and the scarcity of alternatives for the natural gas. Indeed, when hydrocarbons are excluded, the rate of increase in Turkish trade with Iran